EC207 Midterm 1 Review Quiz PDF

EC207 Midterm 1 Review Quiz Question 1 Development economics must have a scope wider than traditional economics because: a. values and attitudes play little role in the pace of development. b. people in developing societies do less utility- maximizing. c. transformation of social institutions is...

EC207 Midterm 1 Review Quiz Question 1 Development economics must have a scope wider than traditional economics because: a. values and attitudes play little role in the pace of development. b. people in developing societies do less utility- maximizing. c. transformation of social institutions is necessary for development. d. all of the above. Question 2 The dependency burden is: a. a measure of the degree to which the less developed countries are dependent on the rich industrial countries. b. the average number of children that a woman gives birth to during her lifetime. c. the number of babies born per 1000 persons. d. the percent of the population that is below 15 and above 65 years of age. Question 3 Technological progress that raises the productivity of existing stock of capital is referred to as: a. capital-saving technology b. labor-saving technology c. capital-augmenting technological progress d. labor-augmenting technological progress Question 4 One of the components of the human development index is: a. the percentage of the population who are high school graduates. b. the average daily intake of protein. c. life expectancy at birth. d. the number of doctors per hundred people in the population.  Question 5 Which measure uses a common set of international prices for all goods and services produced? a. purchasing power parity income levels b. GNI price deflators c. foreign exchange rate conversions to U.S. dollars d. the exchange rate Question 6 A subsistence economy is: a. a very low income economy. b. an economy in which people make what they consume. c. an economy in which people receive food for pay. d. all of the above. Question 7 Which of the following are components of economic growth: a. growth in labor force. b. technological progress. c. investment. d. all of the above.  Question 8 In the public choice (or new political economy) approach to development the emphasis is on: a. growth in the rural sector. b. the self-interested behavior of public officials. c. the dependence of LDCs on former colonial powers. d. the inherent efficiency of developing country markets.  Question 9 The underlying assumption of Harrod-Domar model is that: a. the incremental capital-output ratio is given by k = Y/K. b. growth is mainly determined by capital accumulation. c. growth can be sustained only if agricultural productivity rises. d. developing countries save too much and invest too little. Question 10 The Millennium Development Goals include: a. eliminating the proportion of people living on less than $1 per day. b. universal primary education. c. increasing exports by one half. d. all of the above.  Question 11 A newly industrialized country is: a. the same as a high-income country. b. any country that has experienced sustained growth in industry. c. a special classification given to some upper-middle income countries that have achieved relatively advanced manufacturing sectors. d. any country that has moved out of lower income status. Question 12 Which of the following approaches does not offer an international dependence explanation of underdevelopment? a. the false paradigm model b. the neoclassical counter-revolution c. the dualistic development model d. the neocolonial dependence model Question 13 Which of the following graphs best shows the effect of technological change in the industrial sector on production possibility frontier?  Question 14 Which of the following is a criticism of the neoclassical counter-revolution school’s approach? a. markets are not competitive in developing countries. b. externalities are common in developing countries. c. inequality may worsen when interventions are removed in developing countries. d. all of the above.  Short Answers Explain the concept of population-weighted relative country convergence. Based on the following graphs, do you observe convergence in per capita incomes across countries? Short Answers Read the article, “The Economic Lives of the Poor,” by Abhijit V. Banerjee and Esther Duflo. What are possible reasons described in the article for why the poor typically do not save more? Short Answers Show the equilibrium in Solow growth model in a diagram. What is meant by the steady state? Short Answers Use the information provided to compute the New Human Development Index for Ghana. Answers Question 1 Development economics must have a scope wider than traditional economics because: a. values and attitudes play little role in the pace of development. b. people in developing societies do less utility- maximizing. c. transformation of social institutions is necessary for development. d. all of the above. Question 2 The dependency burden is: a. a measure of the degree to which the less developed countries are dependent on the rich industrial countries. b. the average number of children that a woman gives birth to during her lifetime. c. the number of babies born per 1000 persons. d. the percent of the population that is below 15 and above 65 years of age. Question 3 Technological progress that raises the productivity of existing stock of capital is referred to as: a. capital-saving technology b. labor-saving technology c. capital-augmenting technological progress d. labor-augmenting technological progress Question 4 One of the components of the human development index is: a. the percentage of the population who are high school graduates. b. the average daily intake of protein. c. life expectancy at birth. d. the number of doctors per hundred people in the population.  Question 5 Which measure uses a common set of international prices for all goods and services produced? a. purchasing power parity income levels b. GNI price deflators c. foreign exchange rate conversions to U.S. dollars d. the exchange rate Question 6 A subsistence economy is: a. a very low income economy. b. an economy in which people make what they consume. c. an economy in which people receive food for pay. d. all of the above. Question 7 Which of the following are components of economic growth: a. growth in labor force. b. technological progress. c. investment. d. all of the above.  Question 8 In the public choice (or new political economy) approach to development the emphasis is on: a. growth in the rural sector. b. the self-interested behavior of public officials. c. the dependence of LDCs on former colonial powers. d. the inherent efficiency of developing country markets.  Question 9 The underlying assumption of Harrod-Domar model is that: a. the incremental capital-output ratio is given by k = Y/K. b. growth is mainly determined by capital accumulation. c. growth can be sustained only if agricultural productivity rises. d. developing countries save too much and invest too little. Question 10 The Millennium Development Goals include: a. eliminating the proportion of people living on less than $1 per day. b. universal primary education. c. increasing exports by one half. d. all of the above.  Question 11 A newly industrialized country is: a. the same as a high-income country. b. any country that has experienced sustained growth in industry. c. a special classification given to some upper-middle income countries that have achieved relatively advanced manufacturing sectors. d. any country that has moved out of lower income status. Question 12 Which of the following approaches does not offer an international dependence explanation of underdevelopment? a. the false paradigm model b. the neoclassical counter-revolution c. the dualistic development model d. the neocolonial dependence model Question 13 Which of the following graphs best shows the effect of technological change in the industrial sector on production possibility frontier?  Question 14 Which of the following is a criticism of the neoclassical counter-revolution school’s approach? a. markets are not competitive in developing countries. b. externalities are common in developing countries. c. inequality may worsen when interventions are removed in developing countries. d. all of the above.